A typical mining operation consists of one or more pits where raw material is excavated and transported to the top of each pit. Once at the top of the pit, a decision has to be made as to where to send the material. In the general case, high grade material is sent directly to the product stream to earn revenue and low grade material is sent to waste. Intermediate grade material that is not economic to process immediately can be optionally sent to a dynamic stockpile for reclamation and sale at a later date.
Optimisation of a mining schedule to determine where to mine and what material is sent to product, waste, or to stockpile is determined in order to assign a net present value (NPV) to the mine. It is desirable to optimise the mining, or extraction sequence, so as to produce optimised cash flows (revenue less costs) over the life of mine (LOM) which yield the greatest net present value.
The LOM mine planning optimisation task is simply stated as determining the following decisions for every year until mining is no longer economic:                which material will be mined (extracted) in each period;        of that that material, what tonnage should be sent to waste, product and dynamic stockpile; and        which material should be reclaimed from the dynamic stockpile and sent to product.        
In simple language, a dynamic stockpile is a place where marginal value ore can be placed for later sale. It is usual to define Marginal Value ore as having a grade greater than marginal grade but less than economic grade in a particular period. Marginal grade material is material whose revenue is equal to the cost of processing and marketing. Economic grade material is formally defined as ore an optimal extraction sequence would choose to mine, process and sell in the same period.
Current techniques for modelling dynamic stockpiling within the framework of using mixed integer linear programming optimizer engines define so-called grade bins for material and the optimisation conveniently assumes that individual movements of material in each of a number of grade bins are able to be selectively stored in the stockpile and then retrieved at a later date for sending to product. A grade bin is a volume of material aggregated from individual material movements where those movements consist of material falling within a defined grade range (for example, a copper grade between 0.10 and 0.12%). In this model, any previous ore movement into the dynamic stockpile can be selectively reclaimed exactly as it came in without any dilution at any period in the future, subject to it being economic at the time of reclamation and within the scope of maximizing NPV. In real mining operations, this is obviously an impractical and overly optimistic assumption.
A well-mixed dynamic stockpile is one where material is reclaimed at the average grade of the stockpile as the stockpile is built and reclaimed. The stockpile is assumed to be homogenous at every point. The intrinsic non-linear nature of modelling such a well-mixed dynamic stockpile within a mixed integer linear programming optimization framework is well known.
Our International Application No. PCT/AU2005/000761 describes mining optimisation and a mixed integer linear programming technique for processing information in order to provide extraction schedules and net present value estimations. The contents of this International application is incorporated into this specification by this reference.
The object of the present invention is to provide a methodology whereby a multi-step optimisation procedure is used to build and reclaim from a well-mixed dynamic stockpile which improves overall optimisation of the mining process and which is reasonably tractable.